Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks and Poverty in Haiti

Alan Fuchs

“Authors’ Workshop “Poverty and Climate Change Flagship - An

Overview of the LAC Region”

September 4, 2014

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Question

Shed some light on relation between shocks and poverty in Haiti

Use unique dataset collected by a partnership between the

World Bank and the Government of Haiti (ECVMAS)

Use self-reported information of shocks and correlate with

household characteristics and income levels

Consider households’ risk coping mechanisms: using

savings, receiving aid from friends, changing nutritional

inputs or taking children out of school

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Recent Haitian history has been characterized by a combination of

shocks and slow economic growth

May 2004: Hurricane Jeanne killed around 3,000 people

and left 250k + people homeless

July-September 2008: Cyclones Fay, Gustav, Hanna and

Ike affected over 100,000 homes, destroyed 2/3 of Haiti’s

crops and led to a contraction of 1% of per capita GDP

January 2010: earthquake caused largest contraction of

GDP at 5.5% with a death toll of over 300k + people

2012: Hurricanes Isaac & Sandy destroyed nearly USD 250

million worth of crops and 90k + hectares leading to a 1%

fall in per capita GDP

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Recent Haitian history has been characterized by a combination of

shocks and slow economic growth

May 2004: Hurricane Jeanne killed around 3,000 people

and left 250k + people homeless

July-September 2008: Cyclones Fay, Gustav, Hanna and

Ike affected over 100,000 homes, destroyed 2/3 of Haiti’s

crops and led to a contraction of 1% of per capita GDP

January 2010: earthquake caused largest contraction of

GDP at 5.5% with a death toll of over 300k + people

2012: Hurricanes Isaac & Sandy destroyed nearly USD 250

million worth of crops and 90k + hectares leading to a 1%

fall in per capita GDP

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Recent Haitian history has been characterized by a combination of

shocks and slow economic growth

May 2004: Hurricane Jeanne killed around 3,000 people

and left 250k + people homeless

July-September 2008: Cyclones Fay, Gustav, Hanna and

Ike affected over 100,000 homes, destroyed 2/3 of Haiti’s

crops and led to a contraction of 1% of per capita GDP

January 2010: earthquake caused largest contraction of

GDP at 5.5% with a death toll of over 300k + people

2012: Hurricanes Isaac & Sandy destroyed nearly USD 250

million worth of crops and 90k + hectares leading to a 1%

fall in per capita GDP

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Recent Haitian history has been characterized by a combination of

shocks and slow economic growth

May 2004: Hurricane Jeanne killed around 3,000 people

and left 250k + people homeless

July-September 2008: Cyclones Fay, Gustav, Hanna and

Ike affected over 100,000 homes, destroyed 2/3 of Haiti’s

crops and led to a contraction of 1% of per capita GDP

January 2010: earthquake caused largest contraction of

GDP at 5.5% with a death toll of over 300k + people

2012: Hurricanes Isaac & Sandy destroyed nearly USD 250

million worth of crops and 90k + hectares leading to a 1%

fall in per capita GDP

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Recent Haitian history has been characterized by a combination of

shocks and slow economic growth

May 2004: Hurricane Jeanne killed around 3,000 people

and left 250k + people homeless

July-September 2008: Cyclones Fay, Gustav, Hanna and

Ike affected over 100,000 homes, destroyed 2/3 of Haiti’s

crops and led to a contraction of 1% of per capita GDP

January 2010: earthquake caused largest contraction of

GDP at 5.5% with a death toll of over 300k + people

2012: Hurricanes Isaac & Sandy destroyed nearly USD 250

million worth of crops and 90k + hectares leading to a 1%

fall in per capita GDP

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Literature on shocks and coping is vast, but analyses specific to Haiti

is relatively scarce

Past research suggests that idiosyncratic shocks are more

closely correlated with welfare than covariate shocks:

Jadotte (2010) finds that idiosyncratic shocks are more

important in determining vulnerability to poverty than

covariate shocks

Èchevin (2013) finds that in 2007 rural households that

had experienced an idiosyncratic health shocks had lower

per capita income than households who had not

experienced such a shock

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Literature on shocks and coping is vast, but analyses specific to Haiti

is relatively scarce

Past research suggests that idiosyncratic shocks are more

closely correlated with welfare than covariate shocks:

Jadotte (2010) finds that idiosyncratic shocks are more

important in determining vulnerability to poverty than

covariate shocks

Èchevin (2013) finds that in 2007 rural households that

had experienced an idiosyncratic health shocks had lower

per capita income than households who had not

experienced such a shock

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Background Information

Literature on shocks and coping is vast, but analyses specific to Haiti

is relatively scarce

Past research suggests that idiosyncratic shocks are more

closely correlated with welfare than covariate shocks:

Jadotte (2010) finds that idiosyncratic shocks are more

important in determining vulnerability to poverty than

covariate shocks

Èchevin (2013) finds that in 2007 rural households that

had experienced an idiosyncratic health shocks had lower

per capita income than households who had not

experienced such a shock

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Shocks

ECVMAS includes module on shocks experienced by

households and coping mechanisms employed as response

Information on 18 different shocks and on 35 strategies

was collected

Shocks were grouped in three categories:

idiosyncratic economic shocks

covariate economic shocks

covariate weather/climatic shocks

Idiosyncratic economic shocks were disaggregated into 6

categories: health, household composition, agricultural

setbacks, loss in non-agricultural economic activity,

decrease in outside help and crime

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Shocks

ECVMAS includes module on shocks experienced by

households and coping mechanisms employed as response

Information on 18 different shocks and on 35 strategies

was collected

Shocks were grouped in three categories:

idiosyncratic economic shocks

covariate economic shocks

covariate weather/climatic shocks

Idiosyncratic economic shocks were disaggregated into 6

categories: health, household composition, agricultural

setbacks, loss in non-agricultural economic activity,

decrease in outside help and crime

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Shocks

ECVMAS includes module on shocks experienced by

households and coping mechanisms employed as response

Information on 18 different shocks and on 35 strategies

was collected

Shocks were grouped in three categories:

idiosyncratic economic shocks

covariate economic shocks

covariate weather/climatic shocks

Idiosyncratic economic shocks were disaggregated into 6

categories: health, household composition, agricultural

setbacks, loss in non-agricultural economic activity,

decrease in outside help and crime

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Shocks

ECVMAS includes module on shocks experienced by

households and coping mechanisms employed as response

Information on 18 different shocks and on 35 strategies

was collected

Shocks were grouped in three categories:

idiosyncratic economic shocks

covariate economic shocks

covariate weather/climatic shocks

Idiosyncratic economic shocks were disaggregated into 6

categories: health, household composition, agricultural

setbacks, loss in non-agricultural economic activity,

decrease in outside help and crime

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Coping

Coping strategies were grouped into twelve groups

Analysis focused on differences in shocks and coping

mechanism depending on the household’s poverty status

Thus, the sample was split into four different groups:

extreme poor, poor, vulnerable and resilient

In the sample of 4,930 households, 29% are in extreme

poverty, 19% are in poverty, 10% are vulnerable, and 42%

are resilient

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Coping

Coping strategies were grouped into twelve groups

Analysis focused on differences in shocks and coping

mechanism depending on the household’s poverty status

Thus, the sample was split into four different groups:

extreme poor, poor, vulnerable and resilient

In the sample of 4,930 households, 29% are in extreme

poverty, 19% are in poverty, 10% are vulnerable, and 42%

are resilient

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Methodology: Coping

Coping strategies were grouped into twelve groups

Analysis focused on differences in shocks and coping

mechanism depending on the household’s poverty status

Thus, the sample was split into four different groups:

extreme poor, poor, vulnerable and resilient

In the sample of 4,930 households, 29% are in extreme

poverty, 19% are in poverty, 10% are vulnerable, and 42%

are resilient

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

Average household experienced 2.7 different types of

shocks

extreme poor 3.08 versus resilient 2.53 shocks

rural 3.29 versus Port-au-Prince 1.85 shocks

89% of households experienced at least one shock in the

prior 12 months

96% of households in extreme poverty versus 84% of

resilient households

73% of households experienced idiosyncratic shocks

56% experienced climatic/weather shock

33% experienced community wide economic shock (e.g.

food shortages)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

Average household experienced 2.7 different types of

shocks

extreme poor 3.08 versus resilient 2.53 shocks

rural 3.29 versus Port-au-Prince 1.85 shocks

89% of households experienced at least one shock in the

prior 12 months

96% of households in extreme poverty versus 84% of

resilient households

73% of households experienced idiosyncratic shocks

56% experienced climatic/weather shock

33% experienced community wide economic shock (e.g.

food shortages)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

Average household experienced 2.7 different types of

shocks

extreme poor 3.08 versus resilient 2.53 shocks

rural 3.29 versus Port-au-Prince 1.85 shocks

89% of households experienced at least one shock in the

prior 12 months

96% of households in extreme poverty versus 84% of

resilient households

73% of households experienced idiosyncratic shocks

56% experienced climatic/weather shock

33% experienced community wide economic shock (e.g.

food shortages)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

78% of households in extreme poverty experienced

idiosyncratic shocks versus 70% resilient households

73% of households in extreme poverty experienced weather

shock versus 46% of resilient households

Resilient more likely to experience crime than extreme

poverty (21% versus 13%)

Weather shocks more prevalent in rural areas than

Port-au-Prince (73% versus 34%)

Health shocks more prevalent in rural areas than

Port-au-Prince (48% versus 36%)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

78% of households in extreme poverty experienced

idiosyncratic shocks versus 70% resilient households

73% of households in extreme poverty experienced weather

shock versus 46% of resilient households

Resilient more likely to experience crime than extreme

poverty (21% versus 13%)

Weather shocks more prevalent in rural areas than

Port-au-Prince (73% versus 34%)

Health shocks more prevalent in rural areas than

Port-au-Prince (48% versus 36%)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

78% of households in extreme poverty experienced

idiosyncratic shocks versus 70% resilient households

73% of households in extreme poverty experienced weather

shock versus 46% of resilient households

Resilient more likely to experience crime than extreme

poverty (21% versus 13%)

Weather shocks more prevalent in rural areas than

Port-au-Prince (73% versus 34%)

Health shocks more prevalent in rural areas than

Port-au-Prince (48% versus 36%)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Shocks

78% of households in extreme poverty experienced

idiosyncratic shocks versus 70% resilient households

73% of households in extreme poverty experienced weather

shock versus 46% of resilient households

Resilient more likely to experience crime than extreme

poverty (21% versus 13%)

Weather shocks more prevalent in rural areas than

Port-au-Prince (73% versus 34%)

Health shocks more prevalent in rural areas than

Port-au-Prince (48% versus 36%)

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Coping Mechanisms

Coping mechanisms used depends on Shock Type

Idiosyncratic shocks: most common mechanism is receive

monetary help

Covariate economic or climatic shock: 48% and 24%

changed nutritional inputs

Coping mechanisms vary by poverty status

23% extreme poor changed nutritional profile as a

response to their main shock

10% resilient changed nutritional profile as a response to

their main shock

Resilient households were twice more likely to rely on

(non-loan) monetary help from outsiders than extreme poor

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Coping Mechanisms

Coping mechanisms used depends on Shock Type

Idiosyncratic shocks: most common mechanism is receive

monetary help

Covariate economic or climatic shock: 48% and 24%

changed nutritional inputs

Coping mechanisms vary by poverty status

23% extreme poor changed nutritional profile as a

response to their main shock

10% resilient changed nutritional profile as a response to

their main shock

Resilient households were twice more likely to rely on

(non-loan) monetary help from outsiders than extreme poor

Shocks and

Poverty in

Haiti

AlanFuchs

Question

Analysis

Results

Coping Mechanisms

Coping mechanisms used depends on Shock Type

Idiosyncratic shocks: most common mechanism is receive

monetary help

Covariate economic or climatic shock: 48% and 24%

changed nutritional inputs

Coping mechanisms vary by poverty status

23% extreme poor changed nutritional profile as a

response to their main shock

10% resilient changed nutritional profile as a response to

their main shock

Resilient households were twice more likely to rely on

(non-loan) monetary help from outsiders than extreme poor